1999 News Story

New electricity company announced

Within the framework of the cabinet's approval of the basic system for the newly-formed Saudi Electricity Company (SEC), Minister of Industry and Electricity Dr. Hashim Bin Abdullah Yamani announced yesterday that the electricity sector will be divided into three sections, for production, transportation and distribution, adding that opening a channel for competition in production is one of the bases for future expansion.  New tariffs, he said, will be put into effect within one month. These will be divided into eleven categories, in addition to usage for industrial and for agricultural purposes, and by charitable societies.  He gave assurances that there would be no change in the first five categories, which cover more than 90 percent of household subscribers.

Dr. Yamani said the new company's capital will be SR 33.76 billion (U.S. $ 9 billion), distributed among just over 675 million shares, with each share valued at SR 50 (U.S. $ 13.33), in accordance with the total net assets of the Kingdom's existing electricity companies at the end of fiscal year 1419 H, plus monies from the charge fund in effect since then. He went on to explain that the value of government projects being carried out by the power companies will be added to the capital, and that the issue of undistributed profits will one of the first to be discussed by the Board of Directors.